My father is a minority partner in a joint venture that owns a piece of land for development. His joint venture is dealing with a buyer with "potential" financing that never seems to come through, even after one and a half years. I think it is a scam, but I cannot get any of his partners to believe me. Here are the details:
The individuals who are going to provide the financing are Joseph Hershman (purportedly out of Colorado, though his name shows up in Newport Beach, California) and Gabe Pennicott.
The financiers state that they will do a "trade" internationally that will result in a $100 million loan (as a line of credit) being made available to them. This is also spoken as a "bridge loan". It is supposed to be issued as an MT760.
The financiers state that Bank of America and CitiBank are working on providing the line of credit.
There is discussion about CitiBank sending an MT-799 pre-advice to Bank of America. This was supposed to result in a SBLC (ICC600) being sent by bonded courier to the financiers' bank.
Some delays are blamed on Patriot Act compliance reviews, due diligence of unknown joint venture partners, and the "fact" that the SBLC was sent by courier (which takes a long time to verify manually) rather than by SWIFT (which could be verified quickly electronically).
There is also discussion about receipt of a "POF", though I'm not sure what that is supposed to stand for.
Most convincingly - the buyer my dad's joint venture is dealing with apparently sent the financiers $300,000 (which he obtained from various individuals). The $300,000 is supposed to be turned into $10,000,000 once these "trades" go through.
Anyway, it all sounds like one huge scam to me. But, I can't nail down anything concrete on this being a past scam. I'm hoping someone on here can point me in the right direction, or give me more information, so I can convince my dad's partners to drop this "buyer" and market the property to someone else.
Any assistance is much appreciated.
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The "buyers" are involved with leasing of financial instrument(s), probably from a third party group. With the leased financial instrument (SBLC) they will attempt to activate a line of credit which undoubtedly, is a third party's. The delays are an indication that the deal will not go through, as do the majority of the leased scams. If the "buyers" really had the capacity to issue a SBLC they would be getting the line of credit direct from the issuing bank, much less a MT-799 or MT-760 takes a few hours to issue. Have your father call a seasoned financial or banking attorney, they will confirm everything I just told you.
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a. The names are firmly planted on our redflag list, in its mentioned form as well as with aliases, and we would not do any busyness with them.
b. as far as I know there is an ongoing investigation, I'm not 100% but Florida and some Federal Agencies in the US have some interest I believe to remember.
c. Anyone who wants to use a credit arrangement has proof from the bank or lender. Even if they do not want to open up on banking, you can ask for their legal counsel to issue a legal opinion and a time frame.
d. The seller can terminate the contract and sure for damages if they have damages.
Now in this case what you mention is a big red flag, neither Citibank nor Bank of America in the current market will entertain such structure within the US. The part of the 300.000 turning into 10 M is pretty much a front fee scam.
I'm not sure since I have not seen the papers, but these people are apparently the end of line of an upfront money scam and still believe to be able to obtain the credit. With the credit market not that open today, it means the whole thing was a failure from the beginning.
I know a lot of people who have been caught up in these situations and due to the market give the buyers more time and leeway, even if the stories get more incredible by the day, but it is a mistake and I would pursue the damages area and with a push for fraud so that they can not get out through bankruptcy (which may be tricky if they have been defrauded as well).
Your guys need a new buyer thats all.
Get a lawyer to move on this, if the other partners do not agree, that will be difficult but there should be an agreement to fix a termination date and if they want the contract longer ask them to pay an option fee.
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